Ahead of general elections, Modi has grand plans for Indian middle class

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Ahead of general elections, Modi has grand plans for Indian middle class

By Shantanu Guha Ray
|
February 04, 2018

[File] Prime Minister Narendra Modi | PTI

Probably aware that India’s burgeoning middle class is increasingly turning against his promise of Acche Din – which translates into Good Days, PM Narendra Modi is seeking a parallel, more powerful, vote bank.

The Prime Minister is now placating troubled rural voters and micro businessmen, the ruling NDA knows this segment is a little over 65 crore, and could come handy during the next general elections. There are rumours that Modi would advance the 2019 general polls, clubbing it some state elections this year.

Interestingly, this was one of the key messages the BJP got from the countryside after the Gujarat polls. The BJP noted how Opposition leader Rahul Gandhi galvanised his Congress party by asking in rally after rally of cotton and groundnut farmers a simple question: Are you getting the Minimum Support Price (MSP)? And all would reply in the negative.

Modi took no chance, pushing his ministers to travel across India, engage with people – mostly in the hinterland – and revive a half-century old Congress slogan, coined by the late PM Lal Bahadur Shastri to tackle devastating droughts, Jai Kisan. He even reminded his party that how the BJP had managed to win more votes than the Congress party among the rural poor for the first time in 2014. Elections are due in BJP-ruled Chattisgarh, Rajasthan and Madhya Pradesh this year.

It is reliably learnt that the tone of the Union Budget was changed after the Oxfam report, which criticised the government for being anti-poor and how one per cent of the population held 73 per cent of the nation’s wealth.

Modi, claim sources within the party, pushed Jaitley to focus on a new line, Amiri Hatao – as against the late Indira Gandhi’s Garibi Hatao slogan. He also asked his leaders, much like the late PM Chandra Shekhar, to understand the levels of poverty in rural India. The PM even wanted to know from some of top economists, if there was a growing need to “redefine what constitutes poverty in 2018”.

No wonder then, the MSP was pegged by the BJP at one and a half times of the production costs, a move many claim will impact the farmers. Interestingly, the 1.5 times increase of MSP – as recommended by the M.S. Swaminathan Committee – was a promise BJP made when it came to power, but never implemented it. “Pressures are mounting, the BJP should have implemented the Swaminathan recommendation way back in 2014. Now it is expecting miracles to happen,” says social scientist Yogendra Yadav.

BJP leaders say the party’s rural focus was not at the cost of its urban voters.

“No party would like to allow rural discontent to rise. We are not only focussing on rural India, we have a huge urban base,” argues BJP’s Sambit Patra.

Some BJP insiders claim that the benefits of medical schemes will not be confined to rural India. The services of those in cities will be required to implement such government schemes, thereby creating more oppurtunities for the educated middle class.Health emergencies cause major impoverishment in Indian families, many turn to high-interest moneylenders to avoid India’s cash-strapped public hospitals, perennially low on doctors and medical equipments. But now, with the implementation of new schemes, there will be a demand for new hospitals, medical equipments, doctors, paramedics and the manpower associated with the medicare sector.

“There will be some serious turnaround in the economy. The party hopes the markets to move to a new high by Diwali,” says BJP spokesperson and energy expert, Narendra Taneja.

But worries persist. The BJP knows managing the rural slowdown won’t be easy, anxieties about price rise are on a high across India and it could work against the government in the next elections. “This is a tightrope walk for the PM and his men. The policies of farm prices and loan waivers he is talking about may not benefit everyone in the countryside. But if he can manage it by the end of the year that would be a lot,” says AAP leader Raghav Chadha.

This week, FM Arun Jaitley announced new spending plans and tax breaks aimed at voters who are hardest hit by two years of economic turbulence and slowdown. The FM’s sudden breaking into Hindi while delivering the budget speech was analysed by political observers as BJP’s sign of being earthy. “The party is trying to reach out to a new segment desperately,” says political analyst Mohan Guruswamy.

It is clear, says Guruswamy, that the next poll will be fought by the BJP on the planks of MSP and Modicare, the medical insurance scheme for an estimated 50 crore people who cannot afford quality healthcare at government hospitals and expensive private hospitals.

The farmers will have a bonanza from Modi, who has given them almost anything and everything, ranging from guaranteed MSP, low taxes for agrarian companies, record loans for farmers, cash for 100 days work, homes and roads in villages. Modi’s Operation Greens would cost the government Rs 500 crore. Modi even quoted the Hindu sage, Swami Vivekananda, in saying “let a new generation of farmers emerge from India’s villages to show growth.”

But does that mean the party will stop expecting favours from India’s burgeoning middle class, probably not. Modi, who has always hated the 'we-are-not-happy' attitude of the urban middle class in India, knows he need to deliver some aces by the end of 2018 to swing them to his side.

That could range from bringing back some fugitive barons and settling dues, even some seasoned underworld criminal settled abroad for years, pushing tainted politicians and industrialists behind bars, and getting a fraction of illegal cash stashed away by the rich and famous in tax havens abroad.

Efforts are on to get former liquor baron, Vijay Mallya back to India, and settle the Kingfisher dues. This, claim those within the party, would be a signal of great victory for Modi – not many would remember that Mallya himself had offered to pay up, something which former SBI chairperson Arundhati Bhattacharya had once said in an open forum in the Indian sapital – among the middle class voters. Informed sources in the capital claim that the PM has a hotline with Theresa May and the British PM is not averse to New Delhi's request to extradite the former liquor baron. However, May would rather wait to see how developments unfold in the courts. The former liquor baron is trying hard to explain to the courts in London how things are not so rosy in the Indian Courts, including the apex Supreme Court where some judges openly revolted against the Chief Justice Dipak Misra.

There are chances Lalit Modi could be brought back to India under a settlement wherein former cricket czar and the creator of Indian Premier League (IPL) reveal details of money laundering by some of the team owners.

In politics, it is like unveiling an old statue with a fresh coat of paint, all depending on the quality of colours used. His budget displayed a calm determination towards strengthening local manufacturing, with a tinge of protectionism. Modi knows the underlying incentive is lacking in his much-hyped Make in India programme.

Modi knows how badly India is being damaged by some severe trade competition from China. India’s trade deficit with China has exploded and currently accounts for about 36 per cent of India’s total trade deficit. Worse, China accounts for only about 10 per cent of India’s total trade.

Some of the figures juggled by the PMO in recent months have shown a horrifying image. India exports iron ores, aluminium, refined copper, raw cotton and granites amongst other commodities to the tune of $10 billion. And then, it ends up importing roughly six times the amount. The imports includes all kinds of phones and electronics, solar panels, specialised steel and other manufactured goods, many produced by using Indian raw materials exported to China.

Modi wants to put a check to this growing disparity, he is preparing a game-plan to deal with China. With GST in place, there will be an easier taxation system for the manufacturing sector and with increased customs duties, the imports will slow down. Long term players will move from a trading to manufacturing model.

The PM wants the Make in India lion, made of nuts and bolts, to roar as India faces an imminent need to outgrow Chinese import dependence for its industries, and local manufacturing must speed up to generate the much needed jobs.

Disclaimer: The views expressed in this article are solely those of the author and do not necessarily represent the views of the publication.